Opinion Contributor

Trade pact right for U.S. and EU

Even with its recent woes, the EU economy is larger than our own, the authors write. | Reuters

By REP. ERIK PAULSEN and REP. RICHARD NEAL | 5/5/13 8:34 PM EDT

Democrats and Republicans alike want to see strong economic growth and good jobs for Americans, even if at times we may disagree about how best to achieve these objectives.

So it’s gratifying when both parties agree on something that can boost jobs and spur economic growth in America, like the recent movement toward clinching a comprehensive trade agreement with the European Union, one of our most important allies and commercial partners.

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Earlier this year, members on both sides of the aisle were excited to hear the president mention the importance of trade during his State of the Union address and welcomed his notification to Congress of the intent to launch negotiations toward a Transatlantic Trade and Investment Partnership with the EU.

This is a golden opportunity for America. The United States has often supported European integration as a way to end the rivalries on the continent that too often erupted into violent wars. The EU has been a success, bringing together 27 countries — from Great Britain to Poland, Finland to Portugal — into an integrated partnership that has brought democracy to dictatorships and the former Warsaw Pact. Members of the EU are currently close allies in addressing tensions in the Middle East, development in Africa and the full range of issues that confront us around the world. A deeper economic partnership will only strengthen these allegiances.

Not surprisingly, the United States and the EU already have by far the world’s largest economic relationship. Even with its recent economic woes, the EU economy is larger than our own: It’s a $16 trillion market with 500 million high-income consumers. We already trade more than $1 trillion of goods and services each year.

Even more important, our relationship is based on strong investment ties — the Rolls-Royce and Daimler plants Obama visited last year are but a small fraction of the $1.6 trillion European firms have invested in the United States, employing some 4 million Americans largely in high-paying manufacturing jobs. Alongside the U.S. companies that have invested $2 trillion in Europe over the years, these firms are a major force behind the nearly $500 billion in goods and services we exported to the EU last year.

As strong as our relationship is, we can make it better. We can eliminate the tariffs that tax the integrated operations of our companies, liberalize cross-border trade in services now enabled by the Internet, enlarge investment opportunities, expand access to government procurement markets and build bridges between our regulatory approaches. Doing so would add at least $135 billion to the U.S. economy each year, or about $1,000 for each American family, according to the most recent estimate by the Centre for Economic Policy Research in London.